Legal Fee Information for Remortgage of a Freehold or Leasehold Residential Property
Re-mortgaging involves moving from one mortgage lender to a new lender. We also use that term for anybody who has a property without a mortgage (an unencumbered property) who is taking a mortgage for the first time. Very often re-mortgaging takes place towards the end of a term of an existing mortgage or it is used as a way of raising finance either for personal use or for further investment.
Our team at Orwins are available to provide a fast, efficient and reliable service to try and make the re-mortgage process as quick and pain free as possible. Where there are deadlines that you communicate to us, we will try and ensure that we work to those deadlines, particularly where a mortgage offer is expiring, or a current mortgage needs to be repaid.
Orwins are on the panel of many high street lenders. You are welcome to contact us to find out if the lender you have in mind for your mortgage is one that we can act for jointly with you. Where we can act for you and your lender, our costs may end up being lower than if you required two separate solicitors.
The cost of dealing with a re-mortgage depends on various situations including whether we have an existing mortgage to redeem (or if the property is unencumbered), whether we are acting just for you with another firm of solicitors acting for the lender or whether we are able to represent you jointly.
Legal Fees
Our fees cover all aspects of the legal work required to complete a standard remortgage and include, dealing with a standard mortgage lender’s enquiries and registration at the Land Registry.
We typically work on a fixed fee basis, so that from the outset you know what the fees will be for your transaction.
VAT, currently 20%, will be payable on all our fees and some disbursements, and we will clearly confirm which disbursements carry VAT in formal quotation or as we advise you to incur them.
Our fees
Below is an example of our average fees for a freehold residential mortgage or re-mortgagee:
• Our standard legal fee for a residential mortgage or re-mortgage is from £2,000.00 – £2,500.00 plus VAT (£2,400.00 - £3,000.00 inc. VAT)
The value of the property, location and any complexities of the purchase will dictate the final fee charged within this range.
• We charge £10.00 plus VAT (£12.00 Inc. VAT) Electronic money transfer fee (per transfer.
• For residential property re-mortgages using a corporate vehicle (purchasing a residential property through a Limited company) there is a supplemental fee of £250.00 plus VAT (£300.00 Inc. VAT) plus £15.00 companies house filing fee. This is due to company’s house registration requirements and additional documents required for lending purposes. Please note we need to carry out ID checks on all directors/shareholders which is £6.00 per UK resident person.
• Referral fee (if any): We do not pay referral fees
• For multiple property remortgages, we typically offer reduced per-property rates (e.g., £1,500.00 plus VAT (£1,800.00 inc. VAT) per property for 3+ properties).
Anti-Money Laundering Checks
For all our clients, we are required by our regulator to undertake Client Due Diligence (CDD) which is made of up KYC (Know Your Client) and AML (Anti Money Laundering) details of which are contained within our terms of engagement which will be sent to you when instructing us.
In addition to our standard charges as referred to above, the firm will apply a CDD charge of:
• £20.83 (£25.00 inc. VAT) for undertaking KYC per UK resident individual
Below, we detail what services are covered in our standard fee.
The final quote will depend on the value and location of the property and the complexity of the transaction. We would warn you that there are some charges made by others which we will not be able to ascertain until we are instructed and make the necessary enquiries.
If at any stage our fees change, we will notify you and discuss the reason for any changes. This would typically occur if you change your instructions or your case involves an unforeseen complexity.
Our average fees assume that:
a) this is a standard transaction and that no unforeseen matters arise.
b) the transaction is concluded in a timely manner and no unforeseen complications arise.
c) all parties to the transaction are co-operative and there is no unreasonable delay from any parties providing documentation.
If your matter requires additional work, that is not included in this estimate, we shall inform you of any additional costs as soon as possible. Additional work that is not anticipated may include, but are not limited to, dealing with entries on the Land Registry title such as adding or removing a restriction, dealing with registered notices, redeeming more than one legal charge, drafting statutory declarations etc.
Disbursements and Other Costs
Disbursements are costs related to your matter that are payable to third parties, such as Land Registry fees. We handle the payment of the disbursements on your behalf to ensure a smoother process.
You will be provided with a full list of disbursements in our formal quotation. If you need to incur any further disbursements during your case, you will be notified in advance of the reason and the amount.
Typical disbursements or other costs are:
• HM Land Registry Priority Search £7.00 per title
• Bankruptcy search fees £6.00 (per person)
• If there is Transfer of Equity involved – £400.00 plus VAT (£480.00 Inc. VAT)
• Preparing and submitting SDLT return £100.00 plus VAT (£120.00 Inc. VAT)
In addition to our fees set out above, the following disbursements will be required. These are costs related to your matter that are payable to third parties, such as Searches, and Land Registry fees.
HM Land Registry fee.
The fees chargeable by the land registry can be found here https://www.gov.uk/guidance/hm-land-registry-registration-services-fees
Typical Property Search Fees
Search fees vary from case to case depending on the local authority. We will advise you which searches you need for your transaction and the cost of each search. Our average fee for a standard property search pack (if required by new lender) is estimated at £450.00 - £650.00 (no VAT applies).
• Local Authority Search;
• Environment Search; and
• Water and Drainage Search
Other official local searches may be required by your lender and your conveyancer will use their local knowledge to confirm which local searches you will need. A standard authority search will reveal whether any legal restrictions or obligations affect the property. These include tree preservation orders, flood searches as well as the property’s planning and building enforcement history. Other various searches maybe required depending on your location and can reveal whether the property is in the vicinity of any planned major infrastructure projects. Relevant searches can also reveal if the property is built on or near land that was affected by mining and can include a search for mine shafts and subsidence.
We will advise you which searches you need for your transaction and the cost of each search.
How long will my Mortgage Application take?
The average mortgage or re-mortgage will take between 4-8 weeks.
It can be quicker or slower, depending on a number of factors and we will notify you if we believe your transaction may take longer than average or if something occurs in your case to extend the transaction time we will inform you. Matters that can typically delay a transaction include delays in searches, issues with a mortgage offer or issues raised in a survey.
Stages of the Process
The precise stages involved in the mortgage or remortgage application of a residential property vary according to the circumstances. The broad outline of the work we will be doing for you is as follows:
• obtaining information about the transaction from you
• carrying out all necessary searches and raising enquiries
• considering the provisions of the lease, if the property is leasehold
• receiving mortgage instructions from your lender
• reporting to you on the transaction
• making pre-completion legal arrangements and checks
• obtaining the mortgage advance
• on the completion day, repaying your original mortgage (if applicable)
• notifying the landlord or managing agents of your purchase, if necessary
• registering the transaction at HM Land Registry (which may take some time, although this makes no difference from your point of view) and we will let you have a copy of the certificate of ownership when finalised.
Other Factors and Exclusions
Our fees are fixed, however there may be factors which would typically increase the cost of the fees estimated above. Where there is likely to be any additional cost, we will make sure you are informed of this at the earliest opportunity and a clear estimate of those extra costs will be provided.
We do not undertake mortgage or tax advice. We would recommend you seek advice from an independent mortgage broker or financial adviser and would be happy to recommend a local provider.
We do not carry out valuations on your home, this will be conducted by your new lender.
Other Factors to consider which may affect your legal fees: -
• Multiple owners.
• Shared ownership scheme.
• Mortgaging where there is a help to buy scheme, and whether it is an equity loan or ISA.
• Mortgaging property under right to buy.
• Whether we acting jointly for the lender or solely for the borrower (joint instructions tend to result in an increase of around 30% of the above fees).
• Properties valued over £1m
• Multiple properties being remortgaged simultaneously
• Leasehold properties
• Properties with building safety issues or title defects
• Offshore lenders or complex lending structures
These fees vary from property to property and can, on occasion, be significantly more than the ranges given above. We can give you an accurate figure once we have sight of your specific documents.
For Leasehold properties you should also be aware that ground rent and service charge are likely to apply throughout your ownership of the property. We will confirm the ground rent and the anticipated service charge as soon as we receive this information.
The Conveyancing Team
Depending on the type of transaction, complexity and experience required we will allocate the most appropriate member of our residential conveyancing team to your transaction once you instruct us.
Regardless of who works on your case, they will be supervised by the head of our residential property department Avi Barr, Solicitor and Partner at Orwins.
For more information on our team members, visit Our People.
Questions
If you have any questions relating to our services and our fees, all our contact information can be found here: Contact Us.